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Rate Hikes: The Fed has been expected to impose additional 50 basis-point hikes in both June and July, and now the market is beginning to price in a 50 basis-point hike in September as well. After that, the outlook is a bit cloudier. The market has fully priced in ten rate hikes in 2022 (to the 2.50-2.75% range) and one more in 2023, which would be the fastest pace of hikes since 1989. We expect Fed Chairman Jerome Powell’s tone to remain hawkish in future press conferences. Finally, financial conditions have already tightened significantly. For example, the pop in mortgage rates is harming housing affordability, and with further Fed tightening, there will be more casualties to slow the economy further.



Forgotten 401ks: As of 2021’s end, nearly 25 million 401ks accounts (about 20% of all 401k assets in the US) were forgotten by their owners. The average amount of each account? $55,400. These accounts are typically abandoned after an employee changes jobs and opens a new 401k with their next employer. Out of sight, out of mind, as they say. So what’s to be done? Our frequent advice and assistance to clients is to roll the former 401k into an IRA or merge it into the new 401k. If you think you have an old 401k sitting around somewhere collecting dust, give your advisor a ring.

Build Back Better: Though it wasn’t passed in 2021, President Biden outlined the biggest expansion of the federal government matched with the largest tax increase since 1968. Biden senses the post-COVID era is a once-in-a-generation opportunity to massively restructure US fiscal, monetary, and social policy. This is a big experiment, and we are interested to see how the Build Back Better plan and taxes pan out. It appears this dramatic change in societal direction has proved to be difficult for some moderate Democrats to get on board, i.e., West Virginia Senator Joe Manchin.

Rat Rescue: This is going to sound like a TV show pitch, maybe the premise of the next Pixar film, but it’s 100% true. A research group in Tanzania has launched a program called Hero Rats, which has trained rats to carry the cutest little tactical backpacks bedecked with mics, cameras, and location trackers into disaster zones such as earthquakes or landmine zones. These rats navigate rubble and debris, sniffing out danger zones and reaching victims, providing them contact with outside relief workers. They’re able to train a rat in as little as two weeks. Impressive and hilarious at the same time.